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EXHIBIT 1.2
MASTER AGREEMENT AMONG UNDERWRITERS
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July __, 1999
Joseph Charles & Assoc., Inc.
2500 N. Military Trail
Suite 300
Boca Raton, Florida 33431
Dear Sirs:
We understand that from time to time Joseph Charles & Assoc., Inc., may
act as representative ("Representative") or as one of the Representatives of the
several underwriters of offerings of securities of various issuers. This
Agreement shall apply to any offering of securities in which we elect to act as
an underwriter after receipt of an invitation from you which shall identify the
issuer, contain information regarding certain terms of the securities to be
offered and specify the amount of our proposed participation and the names of
the other Representatives, if any, and that our participation as an underwriter
in the offering shall be subject to the provisions of this Agreement. Your
invitation will include instructions for our acceptance of such invitation. At
or prior to the time of the offering, you will advise us, to the extent
applicable, as to the expected offering date, the expected closing date, the
initial offering price, the interest or dividend rate (or the method by which
such rate is to be determined), the conversion price, the underwriting discount,
the management fee, the selling concession and the reallowance, except that if
the offering price of the securities is to be determined as contemplated by Rule
430A under the Securities Act of 1933, as amended (such procedure being
hereinafter referred to as "430A Pricing"), you shall so advise us and shall
specify the maximum underwriting discount, management fee and selling
concession. Such information may be conveyed by you in one or more
communications (such communications received by us with respect to the offering
are hereinafter collectively referred to as the "Invitation"). If the
Underwriting Agreement (as hereinafter defined) provides for the granting of an
option to purchase additional securities to cover over-allotments or otherwise
(an "over-allotment option"), you will notify us, in the Invitation, of such
option and of our maximum obligation upon exercise of such option.
This Agreement, as amended or supplemented by the Invitation, shall
become effective with respect to our participation in an offering of securities
if you receive our oral or written acceptance and you do not receive a written
communication revoking our acceptance prior to the time and date specified in
the Invitation (our unrevoked acceptance after expiration of such time and date
being hereinafter referred to as our "Acceptance"). Our Acceptance will
constitute our confirmation that, except as otherwise stated in such Acceptance,
each statement included in the Master Underwriters'
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Questionnaire set forth as Exhibit A hereto (or otherwise furnished to us) is
correct. The issuer of the securities in any offering of securities made
pursuant to this Agreement is hereinafter referred to as the "Issuer". If the
Underwriting Agreement does not provide for an over-allotment option, the
securities to be purchased are hereinafter referred to as the "Securities," if
the Underwriting Agreement provides for an over-allotment option, the securities
the Underwriters (as hereinafter defined) are initially obligated to purchase
pursuant to the Underwriting Agreement are hereinafter called the "Initial
Securities" and any additional securities which may be purchased upon exercise
of the over-allotment option are hereinafter called the "Option Securities,"
with the Initial Securities and all or any part of the Option Securities being
hereinafter collectively referred to as the "Securities." Any underwriters of
Securities under this Agreement, including the Representatives (as hereinafter
defined), are hereinafter collectively referred to as the "Underwriters." All
references herein to "you" or to the "Representative(s)" shall mean Joseph
Charles & Assoc., Inc. and the other firms, if any, which are named as
Representatives in the Invitation. The Securities to be offered may, but need
not, be registered for a delayed or continuous offering pursuant to Rule 415
under the Securities Act of 1933, as amended (the "1933 Act").
The following provisions of this Agreement shall apply separately to
each individual offering of Securities. This Agreement may be supplemented or
amended by you by written notice to us and, except for supplements or amendments
set forth in an Invitation relating to a particular offering of Securities any
such supplement or amendment to this Agreement shall be effective with respect
to any offering of Securities to which this Agreement applies after this
Agreement is so amended or supplemented.
SECTION 1. UNDERWRITING AGREEMENT; AUTHORITY OF REPRESENTATIVES. We
authorize you to execute and deliver an underwriting agreement and any amendment
or supplement thereto and any associated Terms Agreement or other similar
agreement (collectively, the "Underwriting Agreement") on our behalf with the
Issuer and/or any selling security holder with respect to the Securities in such
form as you determine. We will be bound by all terms of the Underwriting
Agreement as executed. We understand that changes may be made in those who are
to be Underwriters, and in the amount of Securities to be purchased by them, but
the amount of Securities to be purchased by us in accordance with the terms of
this Agreement, including the maximum amount of Option Securities, if any, which
we may become obligated to purchase by reason of the exercise of any
over-allotment option provided in the Underwriting Agreement, shall not be
changed without our consent except as provided in the Underwriting Agreement.
As Representatives of the Underwriters, you are authorized to take such
action as you deem necessary or advisable to carry out this Agreement, the
Underwriting Agreement, and the purchase and sale of the Securities, and to
agree to any waiver or modification of any provision of the Underwriting
Agreement. To the extent applicable, you are also authorized to determine (i)
the amount of Option Securities, if any, to be purchased by the Underwriters
pursuant to any over-allotment option and (ii) with respect to offerings using
430A Pricing, the initial offering price and the price at which the Securities
are to be purchased in accordance with the Underwriting Agreement. It is
understood and agreed that Joseph Charles & Assoc., Inc. may act on behalf of
all Representatives.
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It is understood that, if so specified in the Invitation, arrangements
may be made for the sale of Securities by the Issuer pursuant to delayed
delivery contracts (hereinafter referred to as "Delayed Delivery Contracts").
References herein to delayed delivery and Delayed Delivery Contracts apply only
to offerings to which delayed delivery is applicable. The term "underwriting
obligation," as used in this Agreement with respect to any Underwriter, shall
refer to the amount of Securities, including any Option Securities (plus such
additional Securities as may be required by the Underwriting Agreement in the
event of a default by one or more of the Underwriters) which such Underwriter is
obligated to purchase pursuant to the provisions of the Underwriting Agreement,
without regard to any reduction in such obligation as a result of Delayed
Delivery Contracts which may be entered into by the Issuer.
If the Securities consist in whole or in part of debt obligations
maturing serial, the serial Securities being purchased by each Underwriter
pursuant to the Underwriting Agreement will consist, subject to adjustment as
provided in the Underwriting Agreement, of serial Securities of each maturity in
a principal amount which bears the same proportion to the aggregate principal
amount of the serial Securities of such maturity to be purchased by all the
Underwriters as the respective principal amount of serial Securities set forth
opposite such Underwriter's name in the Underwriting Agreement bears to the
aggregate principal amount of the serial Securities to be purchased by all the
Underwriters.
SECTION 2. REGISTRATION STATEMENT AND PROSPECTUS; OFFERING CIRCULAR. In
the case of an Invitation regarding an offer of Securities registered under the
1933 Act (a "Registered Offering"), you will furnish to us, to the extent made
available to you by the Issuer, copies of any registration statement or
registration statements relating to the Securities which may be filed with the
Securities and Exchange Commission (the "Commission") pursuant to the 1933 Act
and of each amendment thereto (excluding exhibits but including any documents
incorporated by reference therein). Such registration statement(s) as amended,
and the prospectus(es) relating to the sale of Securities by the Issuer
constituting a part thereof, including all documents incorporated therein by
reference, as from time to time amended or supplemented by the filing documents
pursuant to the Securities Exchange Act of 1934, as amended (the "1934 Act"),
the 1933 Act or otherwise, are referred to herein as the "Registration
Statement" and the "Prospectus," respectively; provided however, that a
supplement to the Prospectus filed with the Commission pursuant to Rule 424
under the 1933 Act with respect to an offering of Securities (a "Prospectus
Supplement") shall be deemed to have supplemented the Prospectus only with
respect to the offering of Securities to which it relates.
With respect to Securities for which no Registration Statement is filed
with the Commission, you will furnish to us, to the extent made available to you
by the Issuer, copies of any private placement memorandum, offering circular or
other offering materials to be used in connection with the offering of the
Securities and of each amendment thereto (the "Offering Circular").
SECTION 3. OFFERING. The sale of the securities to the public shall
commence as soon as you deem advisable. We will not sell any Securities until
they are released by you for that purpose. When notified by you that the
Securities are released for sale, we will offer in conformity with the terms of
the offering set forth in the Prospectus or Offering Circular, such of the
Securities to be
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purchased by us as are not reserved for our account for sale to Selected Dealers
and others pursuant to Section 5. After the initial offering, the offering price
and the concession and discount therefrom may be changed by you by notice to the
Underwriters, and we agree to be bound by any such change.
If, in accordance with the terms of offering set forth in the
Prospectus or Offering Circular, the offering of the Securities is not at a
fixed price but at varying prices set by individual Underwriters based on market
prices or at negotiated prices, the provisions above relating to your right to
change the offering price and concession and concession and discount to dealers
shall not apply, and other references in this Section and elsewhere in this
Agreement to the offering price or Selected Dealers' concession shall be deemed
to mean the prices and concessions determined by you from time to time in your
discretion.
Unless otherwise permitted in the Invitation, we will not sell any
Securities to any account over which we have discretionary authority. We will
also comply with any other restrictions which may be set forth in the
Invitation.
The initial public advertisement, if any, with respect to the
Securities shall appear on such date, and shall include the names of such of the
Underwriters, as you may determine.
SECTION 4. DELAYED DELIVERY ARRANGEMENTS. We authorize you to act on
our behalf in making all arrangements for the solicitation of offers to purchase
Securities from the Issuer pursuant to Delayed Delivery Contracts, and we agree
that all such arrangements will be made only through you (directly or through
Underwriters or Selected Dealers). You may allow to Selected Dealers in respect
to such Securities a commission equal to the concession allowed to Selected
Dealers pursuant to Section 5.
The obligations of the Underwriters shall be reduced in the aggregate
by the principal amount of Securities covered by Delayed Delivery Contracts made
by the Issuer, the obligation of each Underwriter to be reduced by the principal
amount of such Securities, if any, allocated by you to such Underwriter. Your
determination of the allocation of Securities covered by Delayed Delivery
Contracts among the several Underwriters shall be final and conclusive, and we
agree to be bound by any notice delivered by you to the Issuer setting forth the
amount of the reduction in our obligation as a result of Delayed Delivery
Contracts.
Upon receiving payment from the Issuer of the fee for arranging Delayed
Delivery Contracts, you will credit our account with the portion of such fee
applicable to the Securities covered by Delayed Delivery Contracts allocated to
us. You will charge our account with any commission allocated to Selected
Dealers in respect of Securities covered by Delayed Delivery Contracts allocated
to us.
SECTION 5. OFFERING TO SELECTED DEALERS AND OTHERS; MANAGEMENT OF
OFFERING. We authorize you, for our account, to reserve for sale and sell to
dealers ("Selected Dealers"), among whom any of the Underwriters may be
included, such amount of Securities to be purchased by us as you shall
determine. Reservations for sales to Selected Dealers for our account need not
be in
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proportion to our underwriting obligation, but sales of Securities reserved for
our account for sale to Selected Dealers shall be made as nearly as practicable
in the ratio which the amount of Securities reserved for our account bears to
the aggregate amount of Securities reserved for the account of all Underwriters,
as calculated from day to day. Sales to Selected Dealers may be made under the
Joseph Charles & Assoc., Inc. Selected Dealer Agreement, or otherwise. The price
to Selected Dealers initially shall be the offering price less a concession not
in excess of the Selected Dealers' concession set forth in the Invitation.
Selected Dealers shall be actually engaged in the investment banking or
securities business and shall be either (i) members in good standing of the
National Association of Securities Dealers, Inc. (the "NASD") or (ii) dealers
with their principal place of business located outside the United States, its
territories and its possessions and not registered under the 1934 Act who agree
to make no sales within the United States, its territories or its possessions or
to persons who are nationals thereof or residents therein or (iii) banks that
are not eligible for membership in the NASD. Each Selected Dealer shall agree to
comply with the provisions of Rule 2740 of the NASD Conduct Rules, and each
foreign Selected Dealer or bank who is not a member of the NASD also shall agree
to comply with the NASD's interpretation with respect to free-riding and
withholding, to comply, as though it were a member of the NASD, with the
provisions of Rules 2730 and 2750 of the NASD Conduct Rules and to comply with
Rule 2420 thereof as that Rule applies to a non-member foreign dealer or bank.
With your consent, the Underwriters may allow, and Selected Dealers may
reallow, a discount on sales to any dealer who meets the above NASD requirements
in an amount not in excess of the amount set forth in the Invitation. Upon your
request, we will advise you of the identity of any dealer to whom we allow such
a discount and any Underwriter or Selected Dealer from whom we receive such a
discount.
We also authorize you, for our account, to reserve for sale and to sell
Securities to be purchased by us at the offering price to others, including
institutions and retail purchasers. Except for such sales which are designated
by a purchaser to be for the account of a particular Underwriter, such
reservations and sales shall be made as nearly as practicable in proportion to
our underwriting obligation, unless you agree to a smaller proportion at our
request.
At or before the time the Securities are released for sale, you shall
notify us of the amount of Securities which have not been reserved for our
account for sale to Selected Dealers and others and which is to be retained by
us for direct sale.
We will from time to time, upon your request, report to you the amount
of Securities retained by us for direct sale which remains unsold and, upon your
request, deliver to you for our account, or sell to you for the account of one
or more of the Underwriters, such amount of unsold Securities as you may
designate at the offering price less an amount determined by you not in excess
of the concession to Selected Dealers. You may also repurchase Securities from
other Underwriters and Selected Dealers, for the account of one or more of the
Underwriters, at prices determined by you not in excess of the offering price
less the concession to Selected Dealers.
You may from time to time deliver to any Underwriter, for carrying
purposes or for sale by such Underwriter, any of the Securities then reserved
for sale to, but not purchased and paid for by,
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Selected Dealers or others as above provided, but to the extent that Securities
are so delivered for sale by such Underwriter, the amount of Securities then
reserved for the account of such Underwriter shall be correspondingly reduced.
Securities delivered for carrying purposes only shall be redelivered to you upon
demand.
The Underwriters and Selected Dealers may, with your consent, purchase
Securities from and sell Securities to each other at the offering price less a
concession not in excess of the concession to Selected Dealers.
SECTION 6. REPURCHASE OF SECURITIES NOT EFFECTIVELY PLACED. In
recognition of the importance of distributing the Securities to bona fide
investors, we agree to repurchase on demand any Securities sold by us, except
through you, which are purchased by you in the open market or otherwise during a
period terminating as provided in Section 16, at a price equal to the cost of
such purchase, including accrued interest, amortization of original issue
discount or dividends, commissions and transfer and other taxes, if any, on
redelivery. The certificates delivered to us need not be identical certificates
delivered to you in respect of the Securities purchased. In lieu of requiring
repurchase, you may, in your discretion, sell such Securities for our account at
such prices, upon such terms and to such persons, including any of the other
Underwriters, as you may determine, charging the amount of any loss and expense,
or crediting the amount of any net profit, resulting from such sale, to our
account, or you may charge our account with an amount determined by you not in
excess of the concession to Selected Dealers.
SECTION 7. STABILIZATION AND OVER-ALLOTMENT. In order to facilitate the
sale of the Securities, we authorize you, in your discretion, to purchase and
sell Securities or any other securities of the Issuer or any guarantor of the
Securities specified in the Invitation in the open market or otherwise, for long
or short account, at such prices as you may determine, and, in arranging for
sales to Selected Dealers or others, to over-allot. You may liquidate any long
position or cover any short position incurred pursuant to this Section at such
prices as you may determine. You shall make such purchases and sales (including
over-allotments) for the accounts of the Underwriters as nearly as practicable
in proportion to their respective underwriting obligations. It is understood
that, in connection with any particular offering of Securities to which this
Agreement applies, you may have made purchase of securities of the Issuer or
securities of any guarantor of the Securities for stabilizing purposes prior to
the time when we become an Underwriter, and we agree that any such securities so
purchased shall be treated as having been purchased for the respective accounts
of the Underwriters pursuant to the foregoing authorization. At the close of
business on any day our net commitment, either for long or short account,
resulting from such purchases or sales (including over-allotments) shall not
exceed 20% (or such other amount as may be specified in the Invitation) of our
underwriting obligation, except that such percentage may be increased with the
approval of a majority in interest of the Underwriters. We will take up at cost
on demand any Securities or other securities of the Issuer or any securities of
any guarantor of the Securities so sold or over-allotted for our account,
including accrued interest, amortization of original issue discount or
dividends, and we will pay to you on demand the amount of any losses or expenses
incurred for our account pursuant to this Section. In the event of default by
any Underwriter in respect of its obligations under this Section, each
non-defaulting Underwriter shall assume its share of the obligations of such
defaulting Underwriter in the proportion that its underwriting obligation bears
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to the underwriting obligations of all non-defaulting Underwriters without
relieving such defaulting Underwriter of its liability hereunder.
If you effect any stabilizing purchase pursuant to this Section, you
shall promptly notify us of the date and time of the first stabilizing purchase
and the date and time when stabilizing was terminated. You shall prepare and
maintain such records as are required to be maintained by you as manager
pursuant to Rule 17a-2 under the 1934 Act.
SECTION 8. OPEN MARKET TRANSACTIONS. We represent and agree in
connection with the offering of Securities that we have complied and will comply
with the provisions of Regulation M under the 1934 Act with regard to trading in
the Securities. For purposes of the foregoing sentence, we agree that, in
addition to the Securities, other securities of the Issuer or securities of any
guarantor of the Securities or the right or option to purchase or otherwise
acquire any securities of the Issuer or any securities of any guarantor of the
Securities specified in the Invitation shall be considered securities of the
same class and series as the Securities.
SECTION 9. PAYMENT AND DELIVERY. At or before such time, on such dates
and at such places as you may specify in the Invitation, we will deliver to you
a certified or official bank check or a wire transfer in such funds as are
specified in the Invitation, payable to the order of Joseph Charles & Assoc.,
Inc. (unless otherwise specified in the Invitation) in an amount equal to, as
you direct, either (i) the offering price or prices plus accrued interest,
amortization of original issue discount or dividends, if any, set forth in the
Prospectus or Offering Circular less the concession to Selected Dealers in
respect of the amount of Securities to be purchased by us in accordance with the
terms of this Agreement, or (ii) the amount set forth in the Invitation with
respect to the Securities to be purchased by us. We authorize you to make
payment for our account of the purchase price for the Securities to be purchased
by us against delivery to you of such Securities (which may be in temporary
form), and the difference between such purchase price of the Securities and the
amount of our funds delivered to you therefore shall be credited to our account.
Delivery to us of Securities retained by us for direct sale shall be
made by you as soon as practicable after your receipt of the Securities. Upon
termination of the provisions of this Agreement as provided in Section 16, you
shall deliver to us any Securities reserved for our account for sale to Selected
Dealers and others which remain unsold at that time.
You are authorized to make appropriate arrangements for payment for
and/or delivery through the facilities of The Depository Trust Company or any
such other depository or similar facility, the Securities to be purchased by us,
or, if we are not a member, settlement may be made through a correspondent that
is a member pursuant to our timely instructions to you.
Upon receiving payment for Securities sold for our account to Selected
Dealers and others, you shall remit to us an amount equal to the amount paid by
us to you in respect of such Securities and credit or charge our account with
the difference, if any, between such amount and the price at which such
Securities were sold.
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In the event that the Underwriting Agreement for an offering provides
for the payment of a commission or other compensation to the Underwriters, we
authorize you to receive such commission or other compensation for our account.
SECTION 10. MANAGEMENT COMPENSATION. As compensation for your services
in the management of the offering, we will pay you an amount equal to the
management fee specified in the Invitation in respect of the Securities to be
purchased by us pursuant to the Underwriting Agreement, and we authorize you to
charge our account with such amount. If there is more than one Representative,
such compensation shall be divided among the Representatives in such proportions
as they may determine.
SECTION 11. AUTHORITY TO BORROW. We authorize you to advance your own
funds for our account, charging current interest rates, or to arrange loans for
our account or the account of the Underwriters, as you may deem necessary or
advisable for the purchase, carrying, sale and distribution of the Securities.
You may execute and deliver any notes or other instruments required in
connection therewith and may hold or pledge as security therefor all or any part
of the Securities which we or such Underwriters have agreed to purchase. The
obligations of the Underwriters under loans arranged on their behalf shall be
several in proportion to their respective participations in such loans, and not
joint. Any lender is authorized to accept your instructions as to the
disposition of the proceeds of any such loans. You shall credit each Underwriter
with the proceeds of any loans made for its account.
SECTION 12. LEGAL QUALIFICATIONS. You shall inform us, upon request, of
the states and other jurisdictions of the United States in which it is believed
that the Securities are qualified for sale under, or are exempt from the
requirements of, their respective securities laws, but you assume no
responsibility with respect to our right to sell Securities in any jurisdiction.
You are authorized to file with the Department of State of the State of New York
a Further State Notice with respect to the Securities, if necessary.
If we propose to offer Securities outside the United States, its
territories or its possessions, we will take, at our own expense, such action,
if any, as may be necessary to comply with the laws of each foreign jurisdiction
in which we propose to offer Securities.
SECTION 13. MEMBERSHIP IN NATIONAL ASSOCIATION OF SECURITIES DEALERS,
FOREIGN UNDERWRITERS AND BANKS. We understand that you are a member in good
standing of the NASD. We confirm that we are actually engaged in the investment
banking or securities business and are either (i) a member in good standing of
the NASD or (ii) a dealer with its principal place of business located outside
the United States, its territories and its possessions and not registered under
the 1934 Act who hereby agrees to make no sales within the United States, it
territories or its possessions or to persons who are nationals thereof or
residents therein (except that we may participate in sales to Selected Dealers
and others under Section 5 of this Agreement) or (iii) a bank not eligible for
membership in the NASD. We hereby agree to comply with Rule 2740 of the NASD
Conduct Rules, and if we are a foreign dealer or bank and not a member of the
NASD we also hereby agree to comply with the NASD's interpretation with respect
to free-riding and withholding, to comply, as though we were a member of the
NASD, with the provisions of Rule
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2420 of the NASD Conduct Rules, and to comply with Rule 2420 thereof as that
Rule applies to a non-member foreign dealer or bank.
SECTION 14. DISTRIBUTION OF PROSPECTUSES; OFFERING CIRCULAR. We are
familiar with Securities Act of 1933 Release No. 4968 and Rule 15c2-8 under the
1934 Act, relating to the distribution of preliminary and final prospectuses,
and we confirm that we will comply therewith, to the extent applicable, in
connection with any sale of Securities. You shall cause to be made available to
us, to the extent made available to you by the Issuer, such number of copies of
the Prospectus as we may reasonably request for purposes contemplated by the
1933 Act, the 1934 Act and the rules and regulations thereunder.
Our Acceptance of an Invitation relating to an offering made pursuant
to an Offering Circular shall constitute our agreement that, if requested by
you, we will furnish a copy of any amendment to a preliminary or final Offering
Circular to each person to whom we shall have furnished a previous preliminary
of final Offering Circular. Our Acceptance shall constitute our confirmation
that we have delivered and our agreement that we will deliver all preliminary
and final Offering Circulars required for compliance with the applicable federal
and state laws and the applicable rules and regulations of any regulatory body
promulgated thereunder governing the use and distribution of offering circular
by underwriters and any additional instructions contained in the Invitation and,
to the extent consistent with such laws, rules and regulations, our Acceptance
shall constitute our confirmation that we have delivered and our agreement that
we will deliver all preliminary and final Offering Circulars which would be
required if the provisions of Rule 15c2-8 (or any successor provision) under the
1934 Act applied to such offering.
SECTION 15. NET CAPITAL. The incurrence by us of our obligation
hereunder and under the Underwriting Agreement in connection with the offering
of the Securities will not place us in violation of the net capital requirements
of Rule 15c3-1 under the 1934 Act, or, if we are a financial institution subject
to regulation by the Board of Governors of the Federal Reserve System, the
Comptroller of the Currency or the Federal Deposit Insurance Corporation, will
not place us in violation of the capital requirements of such regulator or any
other regulator to which we are subject.
SECTION 16. TERMINATION. With respect to each offering of Securities
pursuant to this Agreement, all limitations in this Agreement on the price at
which the Securities may be sold, the period of time referred to in Section 6,
the authority granted by the first sentence of Section 7, and the restrictions
contained in Section 8 shall terminate at the close of business on the 45th day
after the commencement of the offering of such Securities. You may terminate any
or all of such provisions at any time prior thereto by notice to the
Underwriters. All other provisions of this Agreement shall remain operative and
in full force and effect with respect to such offering.
SECTION 17. EXPENSES AND SETTLEMENT. You may charge our account with
any transfer taxes on sales of securities made for our account and with our
proportionate share (based upon our underwriting obligation) of all other
expenses incurred by you under this Agreement or otherwise in connection with
the purchase, carrying, sale or distribution of the Securities. With respect to
each offering of Securities pursuant to this Agreement, the respective accounts
of the Underwriters
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shall be settled as promptly as practicable after the termination of all the
provisions of this Agreement as provided in Section 16, but you may reserve such
amounts as you may deem advisable for additional expenses. Your determination of
the amount to be paid to or by us shall be conclusive. You may at any time make
partial distributions of credit balances or call for payment of debit balances.
Any of our funds in your hands may be held with your general funds without
accountability for interest. Notwithstanding any settlement, we will remain
liable for any taxes on transfers for our account and for our proportionate
share (based upon our underwriting obligation) of all expenses and liabilities
which may be incurred by or for the accounts of the Underwriters with respect to
each offering of Securities pursuant to this Agreement.
SECTION 18. INDEMNIFICATION. With respect to each offering of
Securities pursuant to this Agreement, we will indemnify and hold harmless each
other Underwriter and each person, if any, who controls each other Underwriter
within the meaning of Section 15 of the 1933 Act, to the extent that and on the
terms upon which we agree to indemnify and hold harmless the Issuer and other
specified persons as set forth in the Underwriting Agreement.
SECTION 19. CLAIMS AGAINST UNDERWRITERS. With respect to each offering
of Securities pursuant to this Agreement, if at any time any person other than
an Underwriter asserts a claim (including any commenced or threatened
investigation or proceeding by any governmental agency or body) against one or
more of the Underwriters or against you as Representative of the Underwriters
arising out of an alleged untrue statement or omission in the Registration
Statement (or any amendment thereto) or in any preliminary prospectus or the
Prospectus or any amendment or supplement thereto, or in any preliminary
prospectus or the Prospectus or any amendment or supplement thereto, or in any
preliminary or final Offering Circular, or relating to any transaction
contemplated by this Agreement, we authorize you to make such investigation, to
retain such counsel for the Underwriters and to take such action in the defense
of such claim as you may deem necessary or advisable. You may settle such claim
with the approval of a majority in interest of the Underwriters. We will pay our
proportionate share (based upon our underwriting obligation) of all expenses
incurred by you (including the fees and expenses of counsel for the
Underwriters) as incurred, in investigating and defending against such claim and
our proportionate share of the aggregate liability incurred by all Underwriters
in respect to such claim (after deducting any contribution or indemnification
obtained pursuant to the Underwriting Agreement, or otherwise, from persons
other than Underwriters), whether such liability is the result of a judgment
against one or more of the Underwriters or the result of any such settlement.
Any Underwriter may retain separate counsel at its own expense. A claim against
or liability incurred by a person who controls an Underwriter shall be deemed to
have been made against or incurred by such Underwriter. In the event of default
by any Underwriter in respect of its obligations under this Section, the
non-defaulting Underwriters shall be obligated to pay the full amount thereof in
the proportions that their respective underwriting obligations bear to the
underwriting obligations of all non-defaulting Underwriters without relieving
such defaulting Underwriter of its liability hereunder.
SECTION 20. DEFAULT BY UNDERWRITERS. Defaults by any Underwriter in
respect of its obligations hereunder or under the Underwriting Agreement shall
not release us from any of our obligations or in any way affect the liability of
such defaulting Underwriter to the other Underwriters for damages resulting from
such default. If one or more Underwriters default under
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the Underwriting Agreement, if provided in such Underwriting Agreement you may
(but shall not be obligated to) arrange for the purchase by others, which may
include yourselves or other nondefaulting Underwriters, of all or a portion of
the Securities not taken up by the Defaulting Underwriters.
In the event that such arrangements are made, the respective
underwriting obligations of the non-defaulting Underwriters and the amounts of
the Securities to be purchased by others, if any, shall be taken as the basis
for all rights and obligations hereunder, but this shall not in any way affect
the liability of any defaulting Underwriter to the other Underwriters for
damages resulting from its default, nor shall any such default relieve any other
Underwriter of any of its obligations hereunder or under the Underwriting
Agreement except as herein or therein provided. In addition, in the event of
default by one or more Underwriters in respect of their obligations under the
Underwriting Agreement to purchase the Securities agreed to be purchased by them
thereunder and, to the extent that arrangements shall not have been made by you
for any person to assume the obligations of such defaulting Underwriter or
Underwriters, we agree to assume our proportionate share, based upon our
underwriting obligation, of the obligations of each such defaulting Underwriter
(subject to the limitations contained in the Underwriting Agreement) without
relieving such defaulting Underwriter of its liability therefor.
In the event of default by one or more Underwriters in respect of their
obligations under this Agreement to take up and pay for any securities purchased
or to deliver any securities sold or over-allotted, by you for the respective
accounts of the Underwriters, or to bear their proportion of expenses or
liabilities pursuant to this Agreement, and to the extent that arrangements
shall not have been made by you for any persons to assume the obligations of
such defaulting Underwriter or Underwriters, we agree to assume our
proportionate share, based upon our respective underwriting obligation, of the
obligations of each defaulting Underwriter without relieving any such defaulting
Underwriter of its liability therefor.
SECTION 21. LEGAL RESPONSIBILITY. As Representative of the
Underwriters, you shall have no liability to us, except for your lack of good
faith and for obligations assumed by you in this Agreement and except that we do
not waive any rights that we may have under the 1933 Act or the 1934 Act or the
rules and regulations thereunder. No obligations not expressly assumed by you in
this Agreement shall be implied herefrom.
Nothing herein contained shall constitute the Underwriters an
association, or partners, with you, or with each other, or, except as otherwise
provided herein or in the Underwriting Agreement, render any Underwriter liable
for the obligations of any other Underwriter; and the rights, obligations and
liabilities of the Underwriters are several in accordance with their respective
underwriting obligations, and not joint.
If the Underwriters are deemed to constitute a partnership for federal
income tax purposes, we elect to be excluded from the application of Subchapter
K, Chapter 1, Subtitle A of the Internal Revenue Code of 1986, as amended, and
agree not to take any position inconsistent with such election, and you, as
Representatives, are authorized, in your discretion, to execute on behalf of the
Underwriters such evidence of such election as may be required by the Internal
Revenue Service.
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Unless we have promptly notified you in writing otherwise, our name as
it should appear in the Prospectus or Offering Circular and our address are set
forth on the signature pages hereof.
SECTION 22. NOTICES. Any notice from you shall be deemed to have been
duly given if mailed or transmitted to us at our address appearing below.
SECTION 23. GOVERNING LAW. This Agreement shall be governed by the laws
of the State of Florida applicable to agreements made and to be performed in
said state.
Please confirm this Agreement and deliver a copy to us.
Very truly yours,
Name of Firm:
By:
-----------------------------------------
Authorized Officer or Partner
Address:
----------------------------------------------
----------------------------------------------
----------------------------------------------
Confirmed as of the date
first above written.
Joseph Charles & Assoc., Inc.
By:
-----------------------------------------
Authorized Officer
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EXHIBIT A
MASTER UNDERWRITERS' QUESTIONNAIRE
In connection with each offering of Securities pursuant to the Joseph
Charles & Assoc., Inc. Master Agreement Among Underwriters, dated
_______________, 1999 (the "Agreement"), each Underwriter confirms the following
information, except as indicated in such Underwriter's Acceptance or other
written communication furnished to Joseph Charles & Assoc., Inc. Defined terms
used herein have the same meaning as defined terms in the Master Agreement Among
Underwriters.
(a) Neither such Underwriter nor any of its directors, officers or
partners have any material (as defined in Regulation C under the 1933 Act)
relationship with Issuer, its parent (if any), any other seller of the
Securities or any guarantor of the Securities.
(b) Except as described or to be described in the Agreement, the Joseph
Charles & Assoc., Inc. Selected Dealer Agreement, the Underwriting Agreement or
the Invitation, such Underwriter does not know: (i) of any discounts or
commissions to be allowed or paid to dealers, including all cash, securities,
contracts, or other consideration to be received by any dealer in connection
with the sale of the Securities, or of any other discounts or commissions to be
allowed or paid to the Underwriters or of any other items that would be deemed
by the NASD to constitute underwriting compensation for purposes of the NASD
Conduct Rules, (ii) of any intention to over-allot, or (iii) that the price of
any security may be stabilized to facilitate the offering of the Securities.
(c) No report or memorandum has been prepared for external use (i.e.,
outside such Underwriter's organization) by such Underwriter in connection with
the proposed offering of Securities or with respect to the Issuer, its parent
(if any) or any guarantor of the Securities and, in the case of a Registered
Offering, where the Registration Statement is on Form S-1 or SB-2, such
Underwriter has not prepared or had prepared for it any engineering, management
or similar report or memorandum relating to the broad aspects of the business,
operations or products of the Issuer, its parent (if any) of any guarantor of
the Securities within the past twelve months (except for reports solely
comprised of recommendations to buy, sell or hold the securities of the Issuer,
its parents (if any) or any guarantor of the Securities, unless such
recommendations have changed within the past six months). If any such report or
memorandum has been prepared, furnish to Joseph Charles & Assoc., Inc. three
copies thereof, together with a statement as to the actual or proposed use,
identifying each class of persons who have received or will receive the report
or memorandum, the number of copies distributed to each class and the period of
distribution.
(d) If the Securities are debt securities to be issued under an
indenture to be qualified under the Trust Indenture Act of 1939, neither such
Underwriter nor any of its directors, officers or partners is an "affiliate," as
that term is defined under the Trust Indenture Act of 1939, of the Trustee for
the Securities as specified in the Invitation, or of its parent (if any);
neither the Trustee nor its parent (if any) nor any of their directors or
executive officers is a director, officer, partner,
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employee, appointee or representative of such Underwriters as those terms are
defined in the Trust Indenture Act of 1939 or in the relevant instructions to
Form T-1; neither such Underwriter nor any of its directors, partners or
executive officers, separately or as a group, owns beneficially 1% or more of
its shares of any class of voting securities of the Trustee or of its parent (if
any); and if such Underwriter is a corporation, it does not have outstanding nor
has it assumed or guaranteed any securities issued otherwise than in its present
corporate name, and neither the Trustee nor its parent (if any) is a holder of
any such securities.
(e) If the Issuer is a public utility, such Underwriter is not a
"holding company" or a "subsidiary company" or an "affiliate" of a "holding
company" or a "public utility company," each as defined in the Public Utility
Holding Company Act of 1935.
(f) Neither such Underwriter nor any "group" (as that term is defined
in Section 13(d)(3) of the 1934 Act) of which it is a member is the beneficial
owner (determined in accordance with Rule 13d-3 under the 1934 Act) of more than
5% of any class of voting securities of the Issuer, its parent (if any), any
other seller of the Securities or any guarantor of the Securities nor does it
have any knowledge that more than 5% of any class of voting securities of the
Issuer is held or to be held subject to any voting trust or other similar
agreement.
We agree to keep an accurate record of the distribution by us of copies
of the Registration Statement, of each amendment thereto, and or each
preliminary prospectus, and we also agree promptly upon request by the Company
or by Joseph Charles & Assoc., Inc. to furnish to each person who received
copies of the above, copies of any subsequent amendment or revised preliminary
prospectus or of any memorandum furnished to us outlining changes in the
Registration Statement or Prospectus. We agree to deliver a copy of the final
form of Prospectus to each person who purchases any of the Securities from us
and shall otherwise comply with the provisions of Rule 15c2-8 under the 1934 Act
and Release No. 4968 under the 1933 Act.
The answers to the foregoing questions are correctly stated and are
true to the best of the knowledge, information and belief of the undersigned.
The undersigned agrees to notify the Company promptly of any material changes in
the foregoing information which may occur prior to the effective date of the
Registration Statement covering the Securities.
Very truly yours,
------------------------------------------
Corporate Name
(For Corporate Signature) By:
--------------------------------------
- ---------------------------------
------------------------------------------
Partnership Name
(For Partnership Signature) By:
--------------------------------------
- ---------------------------------
Dated: , 1999
------------------
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SIGNING PROCEDURE FOR POWER OF ATTORNEY
As a convenience to Underwriters and in order to avoid the necessity of
your having to sign physically the Master Agreement Among Underwriters at our
office on the date of the offering, we have instituted the following signing
procedure:
1. All prospective Underwriters are requested to execute this Power of
Attorney authorizing Joseph C. Visconti and Bruce Jordan of Joseph Charles &
Assoc., Inc., to sign the Master Agreement Among Underwriters on their behalf.
In case of a partnership, this Power of Attorney should be
signed in the firm name by a general partner. In the case of a corporation, it
should be signed in the corporate name by an authorized officer, attested to by
the Secretary of Assistant Secretary and the corporate seal affixed. In both
cases, the partner s or officer s signature should be acknowledged before a
Notary Public.
2. Joseph Charles & Assoc., Inc. will advise the Syndicate Department
of the signer of this Power of Attorney, by wire prior to the signing and public
offering, of the anticipated terms as follows:
(a) Number of shares of stock or other securities to be
underwritten by you.
(b) Public offering date.
(c) Closing date.
(d) Gross compensation and breakdown of management fee,
underwriting fee, selling concession and reliance.
3. Unless the Syndicate Department of Joseph Charles & Assoc., Inc.,
2500 N. Military Trail, Suite 300, Boca Raton, Florida 33431, receives a
telephone call, graphic scanning or telegram (whether or not the notification of
anticipated terms was received) revoking the Power of Attorney (i) not later
than 6:00 a.m. Florida time, on the day of the proposed public offering if the
notification of anticipated terms has been transmitted on the business day
preceding the proposed offering date, or (ii) within two hours following the
transmission of the notification of anticipated terms if such notification has
been transmitted on the proposed offering date, this Power of Attorney will be
exercised as contemplated by its terms.
4. A facsimile signature copy, following by an executed copy, of the
Master Agreement Among Underwriters will be sent to you promptly after its
execution.
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POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby
irrevocably constitute and appoint Joseph C. Visconti, and Bruce Jordan, each of
Joseph Charles & Assoc., Inc., 2500 N. Military Trail, Suite 300, Boca Raton,
Florida 33431, or any of them, the true and lawful agent and attorney-in-fact of
the undersigned, with full power to appoint a substitute or substitutes to act
hereunder with the same power and authority as said agent and attorney-in-fact
would have if personally acting, with respect to all matters arising in
connection with the undersigned's acting as one of the Underwriters of the
proposed offering of __________ shares of common stock, $.001 par value per
share, of NeoTherapeutics, Inc., with full power and authority to execute and
deliver for and on behalf of the undersigned all such agreements, consents and
documents in connection therewith as said agent, and attorney-in-fact may deem
advisable. The undersigned hereby gives to each said agent and attorney-in-fact
full power and authority to execute, by manual or facsimile signature, and
deliver, in such form as said agent and attorney-in-fact may determine, the
Master Agreement Among Underwriters with respect to such securities, authorizing
the Representative named in such Agreement in turn to execute and deliver the
Underwriting Agreement relating to the purchase of such securities and any
Selected Dealer Agreement. The undersigned hereby ratifies and confirms all that
each said agent and attorney-in-fact, or any substitute or substitutes, may do
by virtue hereof.
WITNESS the due execution hereof at _________________________,
_________________ this ______ day of ____________________, 199__.
-------------------------------------
(Name of Corporation or Firm)
(Seal of Corporation, if any,
should be affixed)
-------------------------------------
(Officer of Partner)
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(CORPORATE ACKNOWLEDGEMENT)
STATE OF )
------------------------- )
) ss:
COUNTY OF )
-------------------------
On this _____ day of _______________, 1999, before me, a notary public
in and for said county and state, residing therein, duly commissioned and sworn,
personally appeared _______________, known to me to be _______________ of the
corporation that executed the within instrument and acknowledged to me that he
executed, and was duly authorized to execute, the same on behalf of, and in the
name of such corporation pursuant to its bylaws or a resolution of its
directors.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal in the county and state aforesaid on the day and year first above written.
My Commission expires: .
---------------
------------------------
Notary Public
------------------------
Address
SEAL
(PARTNERSHIP ACKNOWLEDGEMENT)
STATE OF )
------------------------- )
) ss:
COUNTY OF )
-------------------------
On this _____ day of _______________, 1999, before me, a notary public
in and for said county and state, residing therein, duly commissioned and sworn,
personally appeared _______________, known to me to be _______________ of the
corporation that executed the within instrument and acknowledged to me that he
executed, and was duly authorized to execute, the same on behalf of, and in the
name of such corporation pursuant to its bylaws or a resolution of its
directors.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal in the county and state aforesaid on the day and year first above written.
My Commission expires: .
---------------
------------------------
Notary Public
------------------------
Address
SEAL